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Brown Harris Stevens is suing one of its former employees, longtime Hamptons broker Ed Reale, a little more than a month after he left the firm for a new job at Compass real estate.
The lawsuit, filed this week in State Supreme Court, alleges that Mr. Reale violated a non-compete agreement with his former brokerage after he renegotiated his contract in January. The suit, which seeks to recover an unspecified amount in damages, states that Mr. Reale agreed not to compete with Brown Harris in Suffolk County for six months if he left the brokerage. In return, Brown Harris Stevens added three more years to the term of his employment, a 20-percent raise and “agreed—at Reale’s insistence—to pay his base salary during the non-competition period,” according to the suit.
In addition, the suit charges that by hiring Mr. Reale, Compass has “gained access to confidential, proprietary and/or trade secret information relating to Brown Harris’s business in Suffolk County,” which leaves the firm vulnerable to losing more agents and employees.
Mr. Reale was not the only target of the suit, however. Brown Harris Stevens also accuses Compass of “unlawfully ‘poaching’ competitors’ employees” rather than engaging in lawful competition or attempting to purchase competitors’ businesses.
Indeed, Compass has fielded these types of accusations before. Earlier this year, Corcoran sued the brokerage for “brazenly” recruiting its top talent. The suit was later settled.
“We are disappointed that Brown Harris Stevens has sought to use the legal system to inhibit the autonomy and economic free will of one of their former employees,” a Compass spokesperson said in a statement on Tuesday. “Compass believes that culture and opportunity should be the means of retaining employees and has modified its own legal agreement to eliminate legal barriers for people to work where they want.”
Mr. Reale was the senior managing director of Brown Harris’s Southampton, Sag Harbor and Westhampton offices. He is now managing director of sales for Compass’s Hamptons market. He could not be reached for comment Wednesday morning.
on Nov 11, 2015